'Few firms' ready to embrace Internet telephony

NetEvents: Establishing clear business benefits for moving to voice over IP today is proving 'pretty darn difficult' for many enterprises, experts say

IP telephony will overhaul traditional PBX-based telephone systems within five years, but few companies are moving to voice over Internet Protocol (VoIP) today, experts said on Thursday.

Ian Keene, Gartner's vice-president and chief analyst, predicted that 40 percent of telephony clients would be IP-based by 2008, and that a year later Internet telephony would have over half the market.

Advocates of VoIP say that it offers significant benefits, helping companies to run collaboration tools and unified messaging, and to integrate voice with applications such as Oracle.

At present, though, it appears that few companies are ready to make the leap of faith to VoIP.

"Most of the businesses Gartner talks to aren't there yet," Keene told the NetEvents conference in Barcelona, adding that IT managers are finding it "pretty darn difficult" to establish the business benefits.

One factor holding back the deployment of Internet telephony is the investment that companies have made in their existing PBX kit. Iain Milnes, chief executive of Zultys Technologies, a communications system vendor, believes this is a major factor affecting deployment of VoIP.

Milnes says it wouldn't make sense for a company to rip out a working PBX system today, but added that "anyone who needs to replace their phone system today would be nuts not to choose VoIP."

VoIP is one of the most promising technologies approaching mass-market adoption. Bert Whyte, chief executive of broadband networking firm Net.com, warns that it may not be a cash cow for service providers.

"Voice-over-IP is like transatlantic flying. We know that its safe, the quality is now good, and this is stimulating investment by enterprises into VoIP," said Whyte. "But, as with transatlantic flying, the vendors want you to travel first class."

Whyte cautioned that while Internet telephony demand will "shoot up" in the next couple of years, most companies will be looking to save money through VoIP.

"Unless businesses can see the benefits, not a lot of them are going to go first class."

Keene produced statistics from Gartner showing that around two-thirds of telephony shipments in 2004 contained some flavour of Internet telephony, either as a pure IP product or a mixture of IP and PBX.

Spirent Communications, a telecoms testing firm, recently evaluated a range of VoIP products. This testing, according to Spirent, showed that VoIP can offer a high quality service if implemented properly.

"Voice quality was high, possibly better than the quality of the POTS phone on the desk," said Neil Anderson, senior director of services at Spirent.